Discuss the impact on the firm balance sheet

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Reference no: EM132001652

The Strasburg Company’s stock currently trades at $90 per share and the firm has 1,500,000 shares outstanding.

a) The company is considering a 3 for 2 stock split. What will be the company’s stock price following the stock split? How many shares will be outstanding? Discuss the impact on the firm’s balance sheet.

b) If instead of the stock split, the company does a 7% stock dividend. What will be the company’s stock price following the stock dividend? How many shares will be outstanding? Discuss the impact on the firm’s balance sheet.

Reference no: EM132001652

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